Panama is one of the hottest retirement destinations in the world; it offers beachfront living and mountain adventures at an affordable price. But two Santa Barbara expatriates say their idyllic retirement in Panama turned into a nightmare they are trying to escape.
According to expat networking service InterNations, Panama is the 13th ranked retirement destination in the world for overall quality of life. Their criteria include ease of settling into the country, work opportunities and personal finances.
The United States sent the third highest number of migrants to Panama in 2013 at 12,045 according to statistics published by the United Nations.
Conveniently for American expats, Panama uses the American Dollar as currency and the country’s retirement visa system provides special benefits for retirees who meet the criteria including large discounts on flights, public transportation and utilities.
Longtime Santa Barbara residents Peter Shields and Penny Alves say they were enamored by the opportunity to retire in a beach house at a fraction of Santa Barbara’s property and living costs.
A beach house in Santa Barbara, that was up to their specifications, would have cost over $10 million in Santa Barbara compared to well under two in Panama said Mr. Shields.
In 2005 the couple set off for Panama City to search for their dream home.
“Panama was the top retirement destination at the time, we tried to do our research but of course we didn’t know their laws,” Mr. Shields said in a phone interview. He explained the couple spent a month looking for homes in Panama City and near the Costa Rica border until they found a popular beach town, Coronado.
“When we got there, we discovered a new development at the Vista Mar Golf and Beach Resort. Penny wanted to buy a model home there, but I saw an empty lot on the water next to a surf break…and I won out,” said Mr. Shields. After working out the permitting and environmental details, the couple hired architects and contractors to build their home.
Two years later they moved into a stunning residence, “fit for a rockstar,” as Mr. Shields put it.
The home included five bedrooms and five bathrooms, a bar, marble counters, an infinity swimming pool with elevated hot tub and three waterfalls among numerous other luxuries.
For five years, Mr. Shields and Ms. Alves lived out a fantasy vacation: golfing in the mornings, surfing in 88-degree water, and for dinner, freshly caught lobster from a nearby fishing village.
Mr. Shields said that life came to an end in 2012, when developers began construction on a clubhouse, pool and then, in 2013, a marina next to their property.
“The unobstructed views, tranquility and surf break (were) destroyed,” said Mr. Shields who claimed the construction was not done in compliance with Panama environmental law.
“The sound of the trucks shook the house. No one would want to live there,” said Mr. Shields who explained practically everything they had was invested in the property, but no buyers would offer fair price because of the nuisances.
In response, Mr. Shields hired an environmental attorney in Panama to perform an environmental impact report on the new development.
When the developers learned of the report, they found a lawyer, Alejandro Watson, who was willing to take on the property in a cash-trade deal.
The deal went through in late 2014. Mr. Shields said he and Ms. Alves received Mr. Watson’s villa in Punta Barco Resort and one million dollars in exchange for their home.
However, when they tried to sell the villa, Mr. Shields discovered Mr. Watson did not own all the property he sold them. What ensued was a years-long legal battle to recover their beach house complicated by a language barrier and an allegedly unjust legal system.
“We can’t go into the pool house at all. One step off the patio and I’m trespassing,” said Mr. Shields. “He’s an influential lawyer here. And he has friends to protect him.”
Mr. Shields lamented that he and Ms. Alves had to sell properties in Santa Barbara, Lompoc and Palmdale to finance their legal battle.
“We’re stuck here, we’re literally stuck here and it’s unfair. He (Mr. Watson) sold us a property he didn’t own and took advantage of us. Imagine having to deal with this in your 70s,” said Ms. Alves.
She cautioned anyone thinking about moving abroad, especially Panama, to extensively research the country beforehand.
“Know the language and hire a good lawyer, or two.”
Mr. Shields said the couple plans to return to Santa Barbara later this month. They plan to stay at a hotel until they can make other arrangements.